Riding high on its best sales in 7 years, General Motors Comp. (GM) is investing deeply into research and development. The company is striving to deliver on its promise to put 500,000 hybrids, plug-in hybrids electric vehicle (PHEVs), and battery electric vehicles (BEVs) on the road by 2017.

I. GM Guns for 200 Mile EV

Doug Parks, VP of global product development at GM, on Monday reiterated GM's march promise to deliver an electrified vehicle that could travel 200 miles on a charge. Moreover it wants to sell that car at $30,000 USD.

GM didn't clarify whether this figure included the $7,500 USD subsidy EVs currently obtain. It also didn't mention what year it was hoping to release this in-development vehicle in, what form factor it would fall in (e.g. sedan or subcompact), and whether it would be all electric (although given the range, this seems a likely possibility).

GM unveiled an expansion to its battery testing lab in Mich. this week. [Image Source: GM]

Still any way you slice it this would be a huge leap forward for GM; such an EV would have the potential to win over even some hardened critics.

Tom Libby, lead North American analyst for the Polk automotive research firm told the Associate Press, "That would be a huge step forward, no question."

II. World's Top Automaker is Seeing Record Sales

It's an ambitious goal for a company who still has the ugly image of its 2009 Chapter 11 bankruptcy in its rear view mirror. Today, the U.S. government -- which took a 61 percent stake in GM in exchange for wiping out its outstanding debt and helping to reorganize it into a leaner company -- still holds 19 percent of the resulting firm, having sold roughly two thirds of its stock in a 2010 IPO and subsequent stock sales. GM in 2008, 2009, and 2010 was the world's second best selling automaker, but since 2011 has taken hold of first place in sales.

The Chevrolet Volt is the world's top selling PHEV. [Image Source: GM]

On a year-to-year basis as of June 2013 GM sold 4.85 million vehicles overseas and 1.64 million vehicles in the U.S. GM EVs -- the Chevy Volt sedan and Chevy Spark EV subcompact sold 24,467 units -- or roughly half a percent of global sales (~0.5 percent).

Volt sales are up on a year-to-year basis, but GM continues to struggle with production costs. [Image Source: GM]

Since then sales have risen. By June 2013 GM had achieve year-to-year sales of 24,400+ units. But as much as bad sales were a blow to GM's brand image, stronger sales of the flagship EV were bad news for GM's pocketbook.

Where as Tesla Motor Inc. (TSLA) has achieved profitability on its electric vehicles by selling them at much higher price points to the luxury sports car market, GM has admitted in the past to swallowing an undisclosed loss on every Chevy Volt it sells. The 2011 and 2012 Chevy Volt model years were priced at $39,999 -- or $32,249 USD after the $7,500 USD government tax credit. Tesla's current all-electric Model S starts at $71,000 -- nearly twice the price of the Volt -- but delivers an industry-leading 265 miles on a charge.

GM's only all electric -- the 2013 Spark EV -- went on sale in June with a range of 82 miles. Partially due to a very limited release it sold only 27 units (reportedly) that month, and July sales weren't much better at 103 units [source]. The subcompact features impressive acceleration and is priced at an aggressive $32, 495 USD ($24,995 USD after the tax credit).

The Spark EV has sold poorly.

Still that's more expensive than Nissan's LEAF S EV, which retails for $28,800 USD ($21,300 USD after tax rebate). The LEAF has seen rampant demand since its price cut last January (a $6,000 cut from the original price of $35,200 USD). The 2013 LEAF has a slightly worse range at an EPA estimate 75 miles.

The Prius PHEV has been unable to keep up with the Volt in sales. [Image Source: response.jp]

Toyota's plug-in retails for $32,000 USD -- $3,000 USD cheaper than the Volt -- but gets a much weaker 11 mile range (less than a third the Volt's range) in EV mode. Buyers clearly are mixed on this tradeoff.

In the past four years, the competitive landscape in the electrification space has grown exponentially. This has required us to raise our game and draw a new line in the sand. To maintain our battery leadership, this additional real estate is filled with new capability that will help us improve speed to market for our next generation of battery systems and help us improve the value equation to our customers around the world.

GM's efforts are already starting to pay off. It bumped its Chevy Volt's range by 3 miles in 2013 solely by battery improvements. The new facilities nearly double GM's full pack test channels from 64 to 112, while cell level channels are bumped from 96 to 120 units.

The world's biggest automaker will have to move fast, though. Tesla is also eyeing its first try at an affordable mass-market EV. Tesla in May promised a sub-$40,000 USD EV in 3 to 4 years with a range identical to GM's proposed one -- 200 miles.

Tesla's iconic CEO Elon Musk recently commented to the press, "With the Model S, you have a compelling car that’s too expensive for most people. And you have the Leaf, which is cheap, but it’s not great. What the world really needs is a great, affordable electric car. I’m not going to let anything go, no matter what people offer, until I complete that mission."

quote: The problem with plug-in Hybrids (including the Volt) is that you have the cost/weight of the batteries, plus the weight of the ice and the transmission.

My point is precisely that the cost/weight of a small ICE will be less than the difference in battery size.

I'm not talking about regular hybrids. I'm talking about Voltec derived cars which don't need the engine at all unless the battery is low.

quote: I think a range or around 15 miles would be best for a plugin hybrid. Anything higher results in too much cost/weight/space for the battery.

Current PHEVs have awful space optimization. It makes no sense for the C-Max Energy to lose 5 cu ft of luggage space for only 6.2 kWh extra battery over the regular hybrid. Raw battery density is 10x that.

15 miles isn't very optimal, IMO, as you already have all the other electronics in place, and average daily mileage is a lot more.

Actually a 15 mile range would easily cover my commute and over 90% of my driving. Same with the wife (taking kids to school, etc) A 15 mile plug range (assuming I plugged it in every night) would reduce my gas usage so much I would go months between gas station visits.

As for how much extra space the batteries take, you have to take into account the ventilation, mounting, and the safety cage. Large batteries can be dangerous if they are damaged(think explosive fire). They can also overheat, especially during fast charging, if they don’t have good active ventilation.

I support variable battery sizes, and can fully see how 15 miles would be adequate for many people.

But the average new car does 15k miles in its first year, so it's definitely useful for most people to have 25+ mile range in a PHEV.

Also, the Volt's cost premium is more easily made up by those doing a lot more mileage than you are. Of the ~15M new car buyers each year, I'm sure several million have a 50+ mile daily commute plus significant mileage on the weekend. Those are the buyers to whom the Volt makes most economical sense.